Multiple Choice
Which of the following is an example of money illusion?
A) An individual is willing to work more hours when the nominal wage rises by 5 percent and the overall price level rises by 4 percent.
B) An individual is willing to work more hours when the nominal wage rises by 5% and the overall price level rises by 7 percent.
C) An individual will neither increase nor decrease the number of hours she is willing to work when the nominal wage rises by 5 percent and the overall price level rises by 5 percent.
D) none of the above.
Correct Answer:
Verified
Correct Answer:
Verified
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